President again Donald Trump said Monday that he expects to put 25% tariffs on Canada and Mexico starting on Feb. 1, while declining to flesh out his plans for taxing Chinese imports –Associated Press. See Suddenly, Trump wants to play nice with Xi
Many people were against NAFTA in the 90s, except for Ross Perot. Ross was right; a giant sucking sound of automotive jobs went south. That was 30 years ago. Since that time the economy has adapted, as a capitalist economies do. Trump’s claim that manufacturing will move back the the US because of his tariffs is questionable.
Auto manufacturers will do the math and realize the money saved on labor will outweigh the cost associated with moving their plants and paying tariffs. The question is “Does Trump plan to impose the same tariffs on US auto manufacturers who build their vehicles in Mexico along with Mexican goods?“
A 25% tariff on any goods will simply be handed off to the consumer. This will increase inflation. We are still dealing with inflation from the post Covid boom rush.
The inflation rate has been creeping up again. The Fed decided not to lower interest rates in an effort to bring it under control. In September 2024 the consumer inflation rate was 2.44%, in December it was 2.89%. YCharts.
U.S. goods and services trade with Canada… exports were $427.7 billion; imports were $481.2 billion. With Mexico… exports were $362.0 billion; imports were $493.1 billion. Office of the US Trade Representative.
We do a substantial amount of business with Mexico and Canada. NAFTA has turned into a lucrative trading bloc. It is likely these nations will implement a similar tariff on American goods and services in response to Trump’s move. This will hurt US companies and workers.
Taxation and Tariffs are the realm of the US Congress. Imposing Tariffs is not the job of the Executive. However…
Section 5(b) of the Trading with the Enemy Act and Section 203 of the International Emergency Economic Powers Act empower the President in a time of war or emergency to impose tariffs on imports.
Is Trump labeling Canada and Mexico as Enemy Nations? This is a ridiculous claim. The people who can shut down tariffs are in Congress. Trump and his god are out to destroy the US economy and the Republican party; it’s time to put a leash on that man.
- List of automobile manufacturers of the United States Wikipedia
- Could President Trump Really Pull the U.S. Out of NAFTA? Legal Alliance of the Americas